Mitsubishi Electric opens Rs 2,100-crore Chennai AC plant, eyes double-digit CAGR

Chennai: Mitsubishi Electric India has commissioned a Rs 2,100-crore air conditioner and compressor manufacturing facility in Chennai, as the Japanese major steps up expansion in the country's fast-growing cooling market and targets sustained double-digit growth in its air-conditioning business.Spread over 210,000 sq m, the facility was inaugurated virtually by Tamil Nadu chief minister M K Stalin on Friday. The plant will have an annual capacity of 300,000 indoor and outdoor room air conditioners and 650,000 compressors, and is expected to generate over 2,100 direct and indirect jobs.
"We expect our air-conditioning business in India to grow at a double-digit average annual growth rate (CAGR) from FY2025 to FY2030. The commissioning of the new plant strengthens this outlook by enhancing localisation, improving supply stability, and enabling faster response to market needs," Atsushi Takase, managing director, Mitsubishi Electric India, told TOI. Though he did not disclose the exact contribution, he said air conditioning is the company's largest business segment among its three core businesses—air conditioners, factory automation, and semiconductors and devices—in India, where Mitsubishi Electric reported revenue of about Rs 4,200 crore in FY25. The company is on track to more than double its air-conditioning sales in FY26 compared with FY21.The Chennai facility will also support localisation and enable production of inverter air conditioners and compressors. This comes as stricter Bureau of Energy Efficiency (BEE) norms, effective January 2026, are expected to accelerate demand for inverter-based systems due to their higher efficiency and performance.Mitsubishi Electric is positioning itself as a premium brand in India's highly competitive room air conditioner market. The company's air-conditioning business in India is supported by a pan-India network of channel partners, distributors, and specialised Sales & Service Dealers (SSDs). In addition to residential air conditioners, the company is expanding its presence in commercial cooling, including packaged air conditioners and variable refrigerant flow (VRF) systems, driven by demand from offices, retail, healthcare, data centres, and infrastructure. Following the GST rate reduction, India's air-conditioning market has maintained strong growth, supported by urbanisation, rising incomes, improving living standards, and greater awareness of energy-efficient cooling, sustaining double-digit expansion.